The deadweight loss (or excess burden) resulting from levying a tax on an economic activity is the
a. tax revenue raised by the government as the result of the tax.
b. loss of potential gains from trade from activities forgone because of the tax.
c. increase in the price of an activity as the result of the tax levied on it.
d. marginal benefits derived from the expansion in government activities made possible by the increase in tax revenues.
B
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Economic growth refers to an increase in:
A) tax rates. B) prices. C) GDP per capita. D) population.
Refer to Scenario 14.4. Suppose that a pollution tax is imposed on each unit of a firm's output. The number of workers hired
A) will decrease. B) will increase. C) will not change. D) will change in an indeterminate fashion.
A change in tastes for U.S. produced goods will
A) shift both the aggregate demand curve and the long-run aggregate supply curve. B) shift the aggregate demand curve. C) shift the short-run aggregate supply curve. D) shift the long-run aggregate supply curve.
Which of the following will not cause a shift in the demand for resource X?
A. an increase in the productivity of resource X B. a decrease in the price of substitute resource Y C. an increase in the price of the product resource X is producing D. a decline in the price of resource X